Fresh studies predicting adverse economic impacts of a proposed Australian coal mine have strengthened opposition to the A$21.7 billion (HK$126 billion) project by an Indian conglomerate that has become a political hot potato for the Malcolm Turnbull government.

Westpac, the country’s second-largest bank, queered the pitch further when on Friday it announced it would not fund new coal mining regions. With that, Westpac joins three other main banks – ANZ, Commonwealth Bank and National Australia Bank – in distancing themselves from the project.

From campaigns by cricketing legends to an allegedly fake Twitter storm aimed at garnering support, the planned Carmichael coal mine in Queensland has been mired in controversy every step of the way. The project belongs to the Adani Group, known to be close to Indian Prime Minister Narendra Modi.

Both the announcement of an A$1 billion loan from the government and the promise of a supply of 9.5 billion litres of water have proven unpopular, even beyond environmental circles, despite the promise of jobs – 10,000 claimed by the Adanis but 1,500 by other estimates – and the addition to state revenues. Green groups have also expressed concern about the mine’s impact on the delicate Great Barrier Reef.

When completed, the Carmichael mine will be one of the biggest in the world, adding 60 million tonnes per annum to the global supply of thermal coal, making it the biggest mine in Australia and one of the biggest in the world. According to figures from consultancy Wood MacKenzie, Australia exported 203 million tonnes of thermal coal in 2016, meaning Carmichael could add nearly a third to the current supply.

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Independent think tank The Australia Institute (TAI) released a report on Monday calculating the risks to the coal industry in the neighbouring New South Wales province, and the effect on global prices of so much additional coal in the market. “Development of large coal mines in Queensland’s Galilee Basin will reduce thermal coal prices. This also reduces royalty revenue received by NSW. The Adani project alone is likely to reduce NSW revenue by nearly US$50 million per year. The NSW government should oppose subsidies to Adani,” its statement read.

Rod Campbell, research director of TAI, told This Week in Asia that the debate has “left economic and financial reality” and become increasingly politicised, and that “powerful people that count have nailed their colours to the mast in Queensland. They’ve all said they want it. The kind of minor problem is that it’s not financially or economically a good idea.”

Adani has hit back at the central argument that it will increase supply and drive down prices. Spokesman Ron Watson told the Sydney Morning Herald, “We have stated in many official documents that the coal will be bound for India to be used in Adani power stations. It will replace coal from India and Indonesia. It is not going onto the international market.”

But Campbell said, “The idea that Indonesian mines will stop producing coal if the Adani mine goes ahead ignores Indonesian energy policy, which is to expand coal production ... Why would they cease production unless the price goes down?”

The TAI report also states that the federal government should not be funding the mine. The loan, under the government’s Northern Australia Infrastructure Fund, will bankroll the expensive 300km railway to Abbott Port, which Adani purchased from Glencore last year.

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Glencore, headquartered in Switzerland, has substantial mining interests in Australia and has recently reopened some of its coal mines in New South Wales and Queensland. It has been one of the few miners to publicly say anything against the Adani project.

In 2015, Glencore’s Peter Freyberg, head of coal, said taxpayers funding additional tonnes of coal “would materially increase the risk to existing coal operations”. Ian Macfarlane of the Minerals Council of Queensland also expressed dismay.

Public sentiment elsewhere is turning against the mine, though in Queensland support remains because of the anticipated boost to the economy. The mine’s construction is estimated to generate A$203 million a year for Queensland, coal production, A$274.1 million, plus A$5.5 billion in royalties and taxes in the first 10 years.

But the promise of riches has done little to dent the opposition to the mine. Cricket legends Ian and Greg Chappell last month called for Adani to abandon its mine in March, signing a letter with 90 other prominent Aussies and suggesting Australian-Indian ties might suffer if it went through.

Basha Stasak, of the Australian Conservation Foundation, told This Week in Asia: “This whole conversation of handing over a billion dollars and this special treatment of Adani by the state and federal governments is just incredibly, incredibly concerning.”

The project was dragged into further controversy when media reports noted last month during Turnbull’s India visit a sudden gush of tweets praising the project. “There’s An Army Of Indian Twitter Accounts Pushing Suspiciously Identical Pro-Mining Tweets”, reported BuzzFeed, pointing out the similarity of multiple tweets, all hashtagged #Queensland, #Adani and #Carmichael, and all of them claiming the mine would be great for Australian jobs even though it has hardly been a major issue in India itself. It is not uncommon for the same or similar hashtags to appear in tweets on the same subject.

According to Dhruva Jaishankar, a fellow at Brookings India, “Essentially it hasn’t been an issue at all in India. Much has been made of Adani’s personal proximity to Modi, but not a lot of attention has been paid to his overseas projects or acquisitions.”

Given all the controversy, Campbell of TAI thinks the project may not go through in its entirety but rather emerge in an “Adani-lite” version. The company is certainly dragging its feet in some ways. As Stasak pointed out, “We are still waiting on a board decision and for an announcement on who is actually investing in this.”

“At this stage, the 2020 date is looking less and less likely,” said industry consultants Wood MacKenzie. “We believe it would be a challenge to bring Carmichael project online prior to 2020 due to its high CapEx [capital expenditure] and sluggish demand conditions globally for thermal coal.”